By ANDY ANDREWS
Los Alamos World Futures Institute
In the first two parts of this series, we examined risk and rewards, albeit somewhat simplistically.
It becomes significantly more complicated when you consider responsibility, individually and collectively. Let’s begin by quickly returning to the bubble model. As individuals we are represented by as individual bubbles but we can be part of larger bubbles that include public and private bubbles as well as collective bubbles represented as government entities. As a start, let’s explore business entities.
Corporate social responsibility is a term used for a type of international private business self-regulation. It is organizational policy that goes beyond compliance with regulatory and legal requirements to further some social good. If businesses are in business to make money (remember not-for-profits have to make money to stay in business too), why would they be concerned about social issues? And what is a social issue?
A business exists in a society. If the society does not thrive, there is no business; the business, with society, dies. Hence one can argue that we, as a society, need profitable and competitive businesses to create income, wealth, and taxes. Perhaps we should also include philanthropy. A business needs a society to be successful because member bubbles of the society must want, be able to pay for, and consume the products of the business. The business also is part of the society and is responsible to it.
Every business, be it profit or not-for-profit, is obligated to work and act for the benefit of society at large. This is an ethical framework of social responsibility. But not all businesses abide by this principle. The drug cartels are an example. Another example is Volkswagen.
In recent years, VW cheated on emissions testing of certain diesel powered models and was fined a significant amount of money. While the VW actions clearly were intended to circumvent regulations, were its efforts ethical in the context of climate change?
If a business wants to be (should be) socially responsible, it needs to create value, manage risks to itself and society, and engage in philanthropy. At a previous point in my existence, I was involved with an art and jewelry gallery. The gallery created value in that it made a selection of products available to consumers with local convenience. It was also innovative in that it was open on the web in 1995, offering Native American jewelry and local art to the worldwide community. It managed risk in that customers and suppliers (artists) were safe but it did not anticipate the impact of the Cerro Grande fire on its web presence. And it supported the local community. One year, the team that won the County Little League championship had Andrews Gallery on its jerseys.
As a gallery, all of the products offered for sale were, to the best of our knowledge, made by the people represented as the artists. One day a person entered the shop to entice us into buying at wholesale “her” creation. It was a “handcrafted” necklace that appeared to be a Native American creation. The workmanship was excellent and the price was most attractive, but one minor (?) issue existed. Attached to the necklace was a tag that said “Made in Taiwan.” As a business, we could have bought the item, sold it for a quick profit, and nobody would have known. But ethically it would not have been right. The risk of getting caught was essentially zero, but it was not socially responsibility.
Return to the VW emissions issue. According to Consumer Reports, VW settled a civil lawsuit for $14.7 billion because of its violation of the Clean Air Act regulations. Above VW was identified in the context of social responsibility and lacking control of emissions, thereby contributing to climate change. What about the impact on its customers? The issue involves over 600,000 vehicles in the U.S. alone. This implies that several hundred thousand people (owners and families) are affected and have to spend valuable time seeking resolution, actual cash involved notwithstanding.
In philosophy, the term moral responsibility refers to morally deserving praise, blame, reward or punishment for an act or omission. As a social bubble, we have laws and rules that all of the bubbles must obey or pay the price like getting a parking ticket. And we often make choices based on the odds of getting caught. VW did this. But was VW morally responsible or does the term apply only to individuals?
Till next time….
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